Redevelopment Commission Minutes 02.12.26 - Signed

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CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING – February 12, 2026 Page | 5 While it is a federal loan, it is secured by the City’s annual Community Development Block Grant (CDBG) allocation, with a portion of those funds committed over 15 years for debt service. Because those revenues flow through the City, the Indiana Economic Development Corporation recognizes them as an eligible local match. As a general rule of thumb, the 4% tax credit program is typically used for larger developments. The equity generated from selling those credits usually covers about 30 to 40 percent of total project costs, which is why these deals tend to be larger in scale. In contrast, the 9% tax credit is more lucrative, often covering 60 to 70 percent of project costs, but it is highly competitive and more restrictive. As a result, 9% projects are typically smaller, often in the range of 50 to 70 units, with an optimal size around 60 units. For this project, the full scope of Phase 1B includes approximately 208 units. To maximize available funding, the project has been divided into subphases. Phase 1A will deliver roughly 152 units using the non- competitive 4% credits, while a smaller portion will rely on the competitive 9% credits, which are expected to be awarded later this year. The developer has a strong track record of success with competitive tax credit applications, and confidence is high that this application will score well. Secretary Wax requested a more holistic presentation of the overall redevelopment plan once the non-competitive tax credits are officially awarded. Staff indicated that once Phase 1A agreements are finalized, a comprehensive overview of Phase 1A—and later Phase 1B—will be presented, including how the subphases fit together and satisfy grant requirements. While the subphases do not need to move forward simultaneously, both must advance to meet the conditions of various funding sources. Staff confirmed that a broader presentation can be given to the Commission and that any existing presentation materials previously shared with Council could also be provided. Commissioner Gooden-Rodgers asked if the total of the housing units will be the same as the current building. Mr. Bauer stated that once Phase 2 is complete, there will be more units to finish off the block. Tina Patton asked for clarification regarding the displaced residents and how the City is addressing this. Mr. Bauer stated that about two-thirds of the new units in this phase will be income-qualified. This is not the final phase of development. Once all phases are complete, there will be more income-qualified units on the block than existed previously, though that will take time.